The harnessing of energy is what makes possible the world as we know it. The bounty can be measured in terms of virtually everything we do in the course of a day. But can we bet on that for the future?
The growth in world energy demand in the coming decades will be very large, an increase of as much as 35 to 40 percent by 2030. Can this need be met? This increase alone will be greater than all the energy that the world consumed in 1970. Underpinning it all is a fundamental shift in global energy demand, which reflects big changes in the world economy.
At the start of the 21st century, “developed” countries still represented two-thirds of total oil demand. By the end of the decade the split was 50-50 and the shift continues to this day. In terms of oil, North America, Europe and Japan have already reached peak demand. Because of demographics, increased efficiency and substitution, their petroleum consumption will be flat or declining.
The story will be entirely different in emerging markets owing to what I call the “globalization of demand.” China already consumes more total energy than the United States. The same will be true of oil perhaps by the end of the decade, as China becomes more motorized. This year, 20 million new cars will be sold in China, compared to about 15 million in the United States. Some think that number could grow to 30 million.
By: Daniel Yergin